South African fast-food chain owner Famous Brands said on Thursday that annual earnings would be hit by impairment charges amounting up to R400-million ($33.7-million) on its Gourmet Burger Kitchen (GBK) business.
As a result, Famous Brands expects earnings per share to decrease by more than 20% for the year ended February 28.
The company, which owns casual dining chain Wimpy UK and fast-food assets such as Steers and Debonairs, bought Britain's GBK for £120-million ($166.75-million) in 2016.
Famous Brands said it would book an impairment of intangible assets at group level, estimated to be between R241-million and R322-million and an impairment of property, plant and equipment at GBK, estimated to be between R59-million and R78-million.
In addition, a provision for property-related expenses at GBK, estimated to be between R37-million and R49-million, will also be booked.
"The exact valuations of the two impairment figures and the provision will be determined as part of the year-end process," the firm said in a statement.